BEA Systems Inc, looking to cement its position at the top of the middleware game, has taken out a major competitor to its Tuxedo offering by acquiring NCR Corp’s Top End product in a multi- million dollar deal. The deal, which is subject to regulatory approval, gives BEA not only what it calls some excellent technology, but also NCR’s existing Top End customer base, which includes accounts such as the US Postal Service, British Airways Plc and Reuters Holdings Plc, among others. Under the agreement, BEA will also offer jobs to the 65-strong Top End development team. From a technology standpoint, the main attraction of Top End is its strength in the retail applications and datawarehousing spaces, as well as some interesting software configuration technology, according to Alfred Chuang, chief technology officer at BEA. But Ed Scott, BEA’s executive vice president of worldwide operations, stressed that the acquisition is not mainly a technology play, as there are really few differences between Top End and Tuxedo. It’s not about plugging holes in BEA’s existing technology, Scott said. Equally, if not more important, are access to NCR’s customers and the fact that the deal also gives NCR the right to distribute BEA’s products, adding what Deutsche Morgan Grenfell analyst Wendell Laidley called meaningful distribution to a sizeable customer base. NCR will retain the right to sell Top End as an integrated part of its own enterprise systems offerings. The push into the retail and financial sectors that the acquisition offers BEA could well amount to revenues of between $10m and $20m in the first year, according to Scott. Analysts are putting the purchase price at $80 to $100m – a figure extrapolated from the pre-tax gain of around $55m NCR claims it will see. While Scott maintained that his company wasn’t disclosing any figures, he said he wouldn’t argue with that math. In the short term, BEA will sell both Tuxedo and Top End as separate products, and pick the best offering for each customer, and Scott adds that we won’t really see any Tuxedo customers buying Top End, and vice versa. Ultimately, BEA will integrate the products, taking the best from each. It has committed to produce a product road map within the next 90 days, and to finish integration within two years. BEA has also committed to delivering at least two more versions of Top End – one a minor upgrade and the other a full version, according to Chuang – to customers by next year. NCR spokesperson Martin Reed said it was an excellent deal for both companies. NCR will continue to market products such as its SwitchMark switching product for the banking industry, which has Top End embedded into it, and with which it hopes to take on the likes of Tandem Computers Inc. The transaction is expected to close in late June or early July.
